It Takes a (Proactive) Village

Outdated zoning hampers Up North’s year-round economy

Oneupweb moved to Lake Leelanau because it needed more room, but restrictive zoning may force the company to return to Traverse City.

LAKE LEELANAU— Success refuses to leave Lisa Wehr alone. By the end of the month, Oneupweb, her search engine optimization company, based here, will have 40 employees. In the six years since Ms. Wehr founded the high-tech company Oneupweb has grown so fast that she’s moved four times in search of bigger offices.

Now she’s getting ready to move again as Oneupweb outgrows its 6,000 sq. ft. world headquarters in this Leelanau County village.

Oneupweb is just the sort of clean, efficient, solid-wage, non-polluting, 21st-century company that Leelanau County and other rural communities in and out of Michigan are desperate to recruit. Unlike northern Michigan’s manufacturing sector, which has been unable to compete in a global and networked economy and is closing plants and shedding jobs, Oneupweb is a classic example of the opportunities that are now open to smart, technically savvy, and nimble entrepreneurs who want to live in a clean, green, rural, fabulous place like Leelanau County.

But unfortunately for Ms. Wehr and other innovative companies looking to settle in this part of Michigan, outdated master plans and zoning ordinances are restricting the ability of new companies to settle in the region’s small towns. Most master plans and ordinances encourage only small retail operations and private homes within town limits. She is having a very hard time finding downtown commercial lots large enough to house her company anywhere in Leelanau County.

Ms. Wehr and other business owners say the laws need to be modernized to reflect the desires of new business owners to build larger facilities in downtown locations. The benefit of doing so, say advocates, is that village economies will soar, traffic congestion will ease, and farmland and open spaces outside town centers will remain undeveloped.

Fortunately, Leland Township officials recognize the problem. Next week, citizens have the opportunity to participate in two public meetings to review and comment on a new master plan that the township is now considering. The first meeting occurs at 7 p.m. on Monday, March 20, at the Leland Township Hall. The second will be held at 7 p.m. on Wednesday, March 22, at the Leland Library.

Mary Campbell, who owns M.C. Planning and Design in Boyne City and is working with Leland Township to establish its new master plan, said she knows that the community must update its zoning. “At a recent steering committee meeting for the master plan,” Ms. Campbell said in an interview, “there was talk about pursuing another zoning category to accommodate knowledge-based business.”

But how quickly that ordinance update will occur is unclear.

“We’re just moving into looking at revision of zoning ordinances,” she said. “The land use goal for Leland Township is to retain rural character and promote growth in and around villages. If we don’t encourage growth in the villages we’re going to have a sprawl problem.”

For her part, Ms. Wehr just wants an easier way to expand a business within the village limits. “There is a different feel,” she said recently. “The community seems to enjoy seeing our success.”

A Growth CurveIndeed, to say that business has been good for Ms. Wehr and Oneupweb would be an understatement. In 2002, the high-tech entrepreneur moved west from Traverse City to the rolling hills, burnished coastlines, and crystal blue lakes of Leelanau County. The company was so small that employees simply worked out of Ms.Wehr’s Suttons Bay home. But that didn’t work out, so the company moved into Suttons Bay, a village in the county that is tucked into an inlet along Lake Michigan’s Grand Traverse Bay. That did not last very long, either: Oneupweb outgrew its space and limited parking spots and, last February, resettled again, this time in its current location in this even smaller village just down the road from Suttons Bay.

But now the company's next move is encountering zoning barriers that Ms. Wehr didn’t expect. That is a fairly typical problem for many Up North jurisdictions, say planners. Although Leelanau County’s master plan and the Leelanau County Economic Development Corporation support business and residential growth within established village areas, local governments have not kept up with those goals. Zoning ordinances, written for a prior century, make it difficult to build anything other than small retail stores or homes in town limits.

The issue is whether communities are willing to engage the new economic trends motivating entrepreneurs in northern Michigan, and how quickly governments can modernize land use plans. Otherwise, say economic development specialists, business leaders like Ms. Wehr will either never consider settling in Leelanau County, or leave. The number of vacant storefronts in Suttons Bay, Lake Leelanau, and other northern Michigan towns will grow, and tax rolls, local school enrollments, and good paying jobs will shrink.

Ms. Wehr acknowledges that one alternative she is considering is to move back to the city where the company was founded, a northern Michigan city that has taken important steps since the late 1990s to write a new master plan and zoning ordinances specifically to encourage more downtown office construction that can house "new economy" companies.

“The easy choice is to move back to Traverse City,” she said. “That’s not what I want to do.”

Wanted: Modern ZoningDon Coe, the president of the Leenau County Economic Development Corporation and a successful entrepreneur in his own right, said that Ms. Wehr is a “poster child” for the type of economic growth the county wants.

“The Grand Traverse Bay area is competing with other wonderful places to live around the nation, if not the world," Mr. Coe said. "We need to assist them in overcoming barriers we may have created because we were not anticipating this type of growth.”

Mr. Coe, who owns Black Star Farms, a successful vineyard, winery, stable, and bed and breakfast in Suttons Bay, said that many of the zoning ordinances holding back the establishment of high-tech, high-salary, low-pollution businesses like Oneupweb come from a time when towns purposely excluded businesses that polluted or disrupted their quaint, low-key villages. But Leelanau County’s newest master plan now explicitly urges townships to let non-polluting businesses set up shop.

“In striving for an economic future,” the county plan states, “a major effort should be made to create more year-round jobs in businesses and industries which have demonstrated a commitment to environmental protection or do not pose threats to the peninsula’s environmental integrity. Location criteria should include proximity to public services, utilities, transportation, work force, and associated logistical elements.”

Ms. Wehr pointed out that her business is already helping Leelanau County’s modest economy, which is split between two highly seasonal, warm-weather industries: tourism and farming. Many of her employees relocated to Leelanau County to join her company; she said that her workers may now own as much as $4 million in local real estate, a total that does not include workers who are now renting homes in the area. She added that she is sure the area’s businesses are happy to have her workers spend money at their shops and want Oneupweb to stay.

“We are a good type of business to have in the area,” Ms. Wehr said proudly. “My employees are career, non-seasonal, young families.”

It’s a Global ThingOneupweb's search for a new office demonstrates just how much work still needs to be done to better fit local zoning ordinances in northern Michigan with the needs of knowledge-based businesses.

Nearby Suttons Bay, for instance, has proposed anew “office transition district,” along M-22, the main highway. But that proposal and the drafts of its accompanying ordinances would not help Ms. Wehr. The offices would be limited to 5,000 to 8,000 sq. ft. apiece, far less than the 20,000 sq. ft. that Oneupweb needs.

The proposed district would also forbid food services, perhaps including kitchens, in any of the buildings, but would allow vending machines--a rule that could send many entrepreneurs packing.

“Oneupweb and other companies like it are in the global economy,” Mr. Coe said. “That means employees are often working around the clock. These people are going to need to eat beyond the eight-to-five shift.” The township's review of the food service provision and other aspects of the office transition district continues.

Ms. Wehr said she is thinking about building an addition onto her office here, on an adjacent lot. But the whole thing, she said, leaves her frustrated.

“It would be nice if I had more choices,” she said, “but all the property is tied up as agricultural or residential. I don’t want to get political; I want a new office where we can grow.”

“If Lisa was located in another state,” added Mr. Coe, “the governor herself would fly down to convince Oneupweb to come to Michigan. Here we have the business in our county already and she’s facing too many obstacles.”

This is Julie Hay’s first article for the Great Lakes Bulletin News Service. Julie is the Michigan Land Use Institute’s Leelanau County policy specialist. Reach her atJulie@mlui.org.